The International Energy Agency, an industry watchdog, released its an annual global report on Tuesday that described a future that will be heavily powered by clean energy.
But, unfortunately, the world won’t adopt cleaner quickly enough to avoid dangerous changes in the climate, the report said. The Paris-based group’s disturbing findings will add fodder to the global climate change negotiations, which kick off in Paris next month.
Despite the warning, the future of clean energy is bright, but it depends on many complicated factors. Here are some of the nuances and highlights from the 718 page report.
Clean energy will dominate electricity after 2030: Electricity from renewable sources including hydropower, solar, wind and others will replace coal as the largest source of electricity shortly after 2030. That’s thanks to both future global investment in clean energy power plants, and also a decline in coal power use in developed nations like the U.S. and in Europe. By 2040, there will be 13% more energy generated by clean power than by coal plants, the report said.
Clean energy already contributed to almost half of the world’s new power generation capacity added last year, the report found. Collectively clean energy sectors now employ 7.7 million people worldwide, not including for hydropower.
China’s growing service economy is actually a big deal for energy: China, long the world’s factory, has been working to build more industries around services instead of its historic focus on manufacturing and heavy industry. As a result, the country’s energy intensity—energy consumption per unit of economic output—has been declining over the years and that is having a major effect on global energy use. China has been able to reduce the amount of energy it consumes per unit of future economic growth by 85% over the last two decades.
Economic growth and carbon emissions are splitting up: For years, economic development has been tied to energy use. Generally, countries that use a lot of energy have a more robust economy. But with the rise of clean energy technologies, a handful of small European countries have been able to lower their carbon emissions without dampening their economic growth. Norway, Denmark, Finland, Iceland, Norway and Sweden have led this trend.
But now the IEA has found that global carbon emissions remained flat, or declined ever so slightly, in 2014, while the world’s economy actually grew at a decent pace. That is likely an anomaly, and won’t be repeated in the near future. But the data hints that the so-called “decoupling” of carbon emissions and economic growth is starting to happen on a broader scale outside of those small, wealthy early-adopter nations.
India to embrace coal: India’s demand for energy will be insatiable over the next few decades. The country will show the single largest share of growth in global energy demand. While some of that demand will be addressed by wind and solar power, India will also be the nation that adds the most coal consumption. India will become the world’s largest importer of coal by 2020, the report said.
The fossil fuel industry collects far more subsidies than clean energy sectors: The IEA says that the fossil fuel industry received $490 billion in subsidies in 2014. That’s truly shocking considering coal, oil and gas are relatively mature industries. In comparison clean power received $112 billion in global subsidies in 2014. The subsidies for clean energy will rise to $170 billion by 2040, the IEA said.
China dominates solar panels: Companies based in China and Taiwan produced 70% of the world’s solar panels in 2014. More than 9 out of 10 solar panels were made in Asia, says the IEA.
China, India will lead clean energy: More than two thirds of the increase in the world’s clean power generation will come from developing countries like China, India, and Latin America. Electricity demand is growing so rapidly in these countries that they are investing in all forms of power generation, from dirty to clean. China on its own will account for more than a quarter of the world’s increase in clean power generation.
A terrawatt of solar by 2040: Solar panels will become a key mainstream clean energy technology worldwide. By 2040, there will be more than 1,000 gigawatts (or a terrawatt) of solar installed globally. In comparison the U.S. only has about 22 gigawatts of solar in use today.
Hydropower vs. other forms of clean energy: New hydropower plants will largely be built in developing countries, many of which have already tapped most of the optimal regions for dams. Hydropower accounts for much of the clean power in use today, but new investments in clean energy will go toward a combination of wind, solar and hydropower. Wind will take 35% of the global investment for clean energy, while solar will take 28%, and hydropower 22%.
How competitive is clean energy? The IEA report found that in 2014, 84% of clean energy (not including hydropower) was uncompetitive without subsidies. By 2040, 62% of clean energy generation will still remain uncompetitive. Put another way, the report says that only one third of clean energy generation will be competitive without subsidies by 2040.
To learn more about solar watch this Fortune video: